Microsoft has indicated that a US jury has decided in its favour in a case against Motorola relating to Motorola’s licensing of essential patents that are used by Microsoft's Xbox games console. The jury opined that Motorola had violated agreements with Microsoft to license its patents at a fair and reasonable rate. The damages follow from a case last year in which Motorola's demands for a $4 billion-a-year licence fee for the patents were found not to be "reasonable and non-discriminatory" (RAND), with the judge in the related case determining a reasonable annual licence fee instead to be $1.8 million. Motorola’s refusal to provide a patent licence on terms acceptable to Microsoft was considered by the Court to violate Motorola’s obligation to licence on a RAND basis thereby giving rise to the damages reward . Microsoft therefore benefits not only in damages but also in paying a lower licence fee.
The damages awarded in the most recent case, against which Motorola has said it will appeal, amount to $14 million. $11 million of the sum is set to cover the costs of Microsoft relocating a warehouse in Germany following an injunction brought by Motorola on certain Microsoft products in Germany during the dispute over the licence fee, and $3 million is to cover the legal fees paid by Microsoft to fight the injunction. The victory is another piece of good news for Microsoft following its acquisition of part of Nokia's mobile phone business earlier this week.
The failure of Motorola to obtain the high licence fee they demanded might be considered to cast doubt on the amount paid by Google for Motorola Mobility. However, Google’s 2011 acquisition of Motorola was never really about the money. Instead, Motorola's patents have provided Google with a strong position in the highly competitive mobile devices market that strengthens Android and ensures Google's core search business remains prominent on mobile devices.
The one certainty in all of this is that the very significant players in this industry will continue to battle it out in the coming months and years.